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March 2013

March 31, 2013

Mr. and Mrs. Gabbai live in Ashdod. They developed a three-layer mattress, which they asserted helps prevent sudden infant death syndrome (SIDS). In 2007 they filed a US patent application on their mattress, which eventually issued as US 8065767. The corresponding Israel case, application no. 179840, didn’t fare as well: although allowed by the Examiner, the application was rejected by the Deputy Commissioner in pre-grant opposition proceedings instituted by Aminach, a well-established local mattress manufacturer. There are several aspects of the decision worth noting: first, the basis on which the application was (and was not) ultimately rejected; and second, the award of attorneys’ fees given to Aminach.

Aminach asserted that the patent shouldn’t be granted because (a) the Gabbais breached their duty of disclosure (by failing to provide the ILPTO with the publications cited by the USPTO examiner), (b) the claims were unclear, (c) the invention was neither novel nor inventive, and (d) the invention lacked utility.

Despite acting pro se (and, unsurprisingly, making numerous mistakes along the way as a result, e.g. attending the hearing at the ILPTO without being prepared to cross-examine one of Aminach’s witnesses), and despite the fact that Aminach was represented by one of the largest IP firms in Israel, the Gabbais managed to successfully parry most of these assertions. With respect to the non-disclosure of the references from the USPTO, the Deputy Commissioner noted that deliberate concealment is one of the requirements for sanctioning an applicant for non-disclosure, and she ruled that since Aminach hadn’t provided any evidence to show that the non-disclosure was deliberate, she had to find for the Gabbais on this point. Likewise, she found that the invention was novel and inventive over the prior art cited by Aminach.

What the Deputy Commissioner found lacking was utility. The Gabbais had asserted in their application that the mattress reduced the incidence of SIDS. Aminach’s expert witness, a physician, pointed out that there was no evidence in the application or even provided by the Gabbais later that showed that the mattress in fact achieved this result. Since the Gabbais were deemed not to have submitted their own evidence (because their evidence was filed as a letter rather than an affidavit), and their cross-examination of Aminach’s expert wasn’t terribly successful, the Deputy Commissioner ruled that that invention lacked utility and was therefore unpatentable.

The difficulty with that determination is, of course, that no one disputes that the mattress actually worked as a mattress. That alone is sufficient to qualify for utility under section 3 of the statute: “An invention, whether a product or process, in any technological field, which is new, useful, susceptible of industrial use and inventive, is a patentable invention.” Whether or not the mattress worked to reduce SIDS is (or should have been) immaterial. By stressing in their patent application that the mattress reduced in the incidence of SIDS, the Gabbais opened themselves to obfuscation of this point by Aminach’s attorneys. Had the application merely described what the invention is – viz., a mattress having a particular construction – without singing its praises, it is doubtful that the Deputy Commissioner would have been duped into agreeing that the invention lacked utility.

(Having determined that the invention lacked utility, the Deputy Commissioner didn’t rule on the clarity of the claims.)

No less remarkable was the awarding of 40,000 shekels (over US $10,000) in attorneys’ fees to Aminach. Aminach actually asked for over 140,000 shekels in fees, but refused to provide its attorneys’ billing sheets on the grounds that these were privileged. The Deputy Commissioner ruled that the billing sheets were not privileged documents, and that their non-production left the Gabbais without an opportunity to challenge the billings; nevertheless, she awarded 40,000 shekels on the basis of “the evidence and pleadings filed by the opponent, the fact that the applicants didn’t file their own evidence, and the great savings incurred by the fact that the summations were presented orally rather than in writing [as is the norm in Israeli legal proceedings – DJF]”.

Perhaps the Deputy Commissioner felt that she was doing the applicants a favor by awarding significantly lower fees than the prevailing party requested, but it’s still a slap in the face: you file a patent application on an invention which is novel and inventive, you nevertheless lose in an opposition, and then you have to pay the other side? It should also be borne in mind that just a few years ago, an award of 40,000 shekels was unthinkable – an award of just 5,000 shekels would have been considered sizeable. The request for 140,000, and the granting of 40,000, are clearly the result of the ILPTO’s trend to grant attorneys’ fees award far in excess of what real courts of law themselves actually award.

If anything, the fee award in this case will discourage inventors with little money from seeking to commercialize their inventions or otherwise disclose them in patent applications – why bother to do so if a better-funded competitor hire some good lawyers to sell the ILPTO a load of baloney not only to prevent you from getting a patent you deserve, but to also convince the ILPTO to tell you have to pay for your competitor’s lawyers?

(For those of you who read Hebrew, the transcript of the hearing before the Deputy Commissioner, as well as the letter the Gabbais sent to her the day after the hearing, both of which can be viewed on the ILPTO’s web site, make good reading if you’re looking to illustrate why acting pro se is usually a bad idea.)